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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (28118)	2/12/1999 5:32:00 PM
From: Giraffe	Read Replies (3) \| Respond to of 116830

Warning: The following off topic message contains no mention of the National Guard and only discusses the price of gold. :) GOLD: Report clips wings of the bugs By Gillian O'Connor Mining Correspondent Andy Smith, the enfant terrible of the precious metals industry, has been wielding his fly-swatter against the gold bugs - again. His latest paper doesn't just attack the idea that gold and commodities could provide a useful hedge in a deflationary climate; it batters it into a persistent vegetative state. Start with commodities, which have only a vestigial importance to a modern economy. Their increasingly wild price swings have no discernible correlation with the ever smaller waves in general prices or the ever fewer troughs in economic activity. "Prehensile tails don't wag dogs." Classical economic theory, which said commodity prices must rise in real terms, is outdated bunkum. Over the past 200-odd years, commodity prices have fallen by either 60 or 75 per cent, depending which yardstick you choose for inflation. Metals have lagged even further behind than other commodities. What is more, there is no obvious reason why they should stop lagging. Forget the argument that raw material resources are finite. There are lots there and people are increasingly ingenious at getting them out economically. Resources today are in many cases higher than they were decades or even centuries ago, despite the interim consumption. This argument works in spades for silver and gold, because they do not get used up. "More or less all the gold or silver ever mined still exists." In the past, gold, silver and oil have appeared to buck the general commodity trend because their prices were rigged. The two precious metals were treated as money, and the oil price was supported by a relatively successful cartel. But oil and gold are now heading down towards the general commodities trend-line. And silver provides an awful warning of what happens when a precious metal is "demonetised": it has already rejoined the herd of ordinary commodities. So how about gold as a store of value? Actually it never has "maintained its value" over long periods. The average real price (in 1998 $ per ounce) has been around $281 since 1560, but there have been wild and prolonged price swings around that average: the standard deviation is a mighty $84. "An investor who bought gold in 1565 at the bargain real price of $440 (down from $702 in 1562) would have had to wait until 1979 to sell at a profit and would presumably be spinning in his (pauper's) grave." When the price has picked up it has done so thanks to central bank buying. And their gold hoards - 14 years worth of mine supply - are now overhanging the market. As, indeed, are the private hoards in the east. Gold may be a valuable deflation hedge, assuming all deflations are "singular catastrophes" involving panic, meltdown, bankruptcies and general financial mayhem, runs one gold-friendly argument. But Mr Smith reckons that most deflations are in practice jolly boring. And even on the rare occasions when deflation and panic coincide, precious metals have not benefited. Gold bugs also peddle the idea that, even if the west ceases to support the price, naive orientals will do so in their stead. So why didn't the Japanese turn to gold as their economy collapsed? And remember the more recent economic crash in east Asia: savers actually bailed out of gold. We have already seen what the east will do in extremis, and they did not support gold. So where will the gold price be by 2010? Cannily, Mr Smith makes no forecasts; instead he does three extrapolations from earlier trends: 1970-1998 real trend: this suggests gold would rise to $414 an ounce and oil to $17 a barrel (in 1998 dollars). 1900-1998: gold would move to $280 an ounce and oil to $12 a barrel. 1990-1998: gold would fall to $150 an ounce and oil to $4 a barrel. "Gold and Commodities in deflations: attempted facelift" is a presentation to the Bank Credit Analyst conference in Miami by Andy Smith of Mitsui. Financial Times We return you now to our featured topic National Guard: Mercenary Murderers or Heroes of the Republic?

To: Hawkmoon who wrote (28118)	2/12/1999 10:59:00 PM
From: cAPSLOCK	Read Replies (1) \| Respond to of 116830

However, after today's vote in the Senate, we all know how politics work to protect the guilty in the interest of preserving the "integrity" of the institution. Hmm.. we unfortunately are in agreement here. I felt kind of sick today. And I am in no means an anti-Clinton type. I am not even sure that removal from office would have ebbn the right thing for sure... But his total disregard for the '"integrity" of the institution', and sole regard for his own ass make me want to puke in my shoes. best, cAPS

To: Hawkmoon who wrote (28118)	2/13/1999 1:47:00 AM
From: cAPSLOCK	Read Replies (1) \| Respond to of 116830

Skip this repeat post! Wierd... Sorry.. dont know how this got posted twice, but I seem to still have time to edit this copy However, after today's vote in the Senate, we all know how politics work to protect the guilty in the interest of preserving the "integrity" of the institution. Hmm.. we unfortunately are in agreement here. I felt kind of sick today. And I am in no means an anti-Clinton type. I am not even sure that removal from office would have been the right thing for sure... But his total disregard for the '"integrity" of the institution', and sole regard for his own ass make me want to puke in my shoes. best, cAPS